Published on and written by Cyril Jarnias
Montenegro’s real estate sector, already undergoing significant transformation, has seen its dynamics profoundly reshaped by the Covid-19 pandemic. While the country traditionally attracts buyers seeking secondary residences along the Adriatic coast, the virus’s impact on lifestyles has led to a reassessment of priorities.
Successive lockdowns and remote work have fueled a quest for space and comfort, prompting buyers to prioritize isolated properties or those located in natural environments. This new trend has also brought previously overlooked markets to the forefront, with increased demand for properties offering green and open spaces, away from urban hustle and bustle.
This article explores how these new preferences are shaping Montenegro’s real estate market, creating unprecedented opportunities for investors and individuals alike.
Impact of COVID on Montenegro’s Real Estate Market
Analysis of Property Price Changes Before and After the Pandemic
Real estate prices in Montenegro have experienced significant growth since the pandemic. While 2020 marked a slight market downturn due to the health crisis, values quickly rebounded. By May 2025, the median price for an apartment reached €3,420/m², while houses reached €2,620/m². This increase is explained by rapid post-pandemic recovery and sustained demand that allowed the local market to surpass pre-crisis levels.
| Property Type | Median Price (€/m²) |
| Apartment | 3,420 |
| House | 2,620 |
For Apartments:
- Studio: €3,226/m²
- 2-Bedroom: €3,389/m²
- 3-Bedroom: €3,574/m²
- 4-Bedroom: €5,123/m²
- 5-Bedroom: €5,440/m²
For Houses (by Number of Rooms):
- 4 rooms: €2,671/m²
- Larger volumes (>7 rooms): around or below €2,220–2,749/m²
Demand Assessment by Type and Region
Demand has strengthened for several segments:
- Spacious family apartments show notable growth.
- Single-family homes are particularly sought after in coastal areas and near natural spaces.
- Interest in secondary residences has intensified among foreign buyers whenever possible.
Coastal regions like Budva, Kotor, or Herceg Novi remain highly attractive, but renewed interest is also noted for inland areas offering more space.
Buyer Preference Trends
New trends are clearly emerging:
- Increased preference for homes with terraces, gardens, or balconies.
- Growing demand for proximity to nature.
- Active search for properties allowing home office setup, reflecting remote work becoming common post-pandemic.
Impact of Restrictions on Foreign Purchases
International travel restrictions temporarily slowed real estate acquisition by foreign clients, who previously represented an essential driver of Montenegro’s market. This decline was partially offset by the gradual return to international mobility post-pandemic, which also partly explains the spectacular rebound observed recently.
Government Interventions and Policies During the Pandemic
The Montenegrin government intervened to:
- Provide economic support to various sectors (including real estate) through direct aid to impacted businesses,
- Maintain a favorable environment for real estate credit through accommodative monetary policy,
This allowed the local real estate sector not only to absorb the initial shock but also to quickly rebound upward afterward.
Illustrative Testimonials
“After several very quiet months where everything seemed frozen, we saw local then international buyers return en masse as soon as possible. Criteria evolved toward more outdoor space and less focus on hyper-central locations.”
— Real Estate Agent based in Budva
“We were mainly looking for a house with sea view AND possibility to work remotely in a dedicated space… this has now become our main criterion.”
— Expat couple who purchased in late 2024
Post-COVID Outlook for Montenegro’s Market
Current dynamism should continue provided stable economic conditions are maintained:
- Expected moderate price increases in certain still-coveted areas;
- Likely lasting preference for open/natural spaces;
- Continued strong international interest as long as regulatory framework remains welcoming;
- Sustainable adaptation of supply/products to new hybrid private/professional lifestyles;
The market thus demonstrates its ability not only to withstand but also capitalize on these profound changes induced by COVID.
Good to Know:
Since the COVID-19 pandemic, Montenegro’s real estate market has undergone notable transformations, with price increases of 15% to 20% after an initial decline, according to latest statistics. Demand for single-family homes and secondary residences, especially those located near nature, has increased, while city apartments have seen reduced interest. Buyers now seek open spaces and homes equipped with home offices. Due to travel restrictions, foreign purchases temporarily declined, forcing the local market to reorient toward domestic clientele. To stabilize the sector, the government offered low-interest loans and subsidies for first-time buyers. Real estate agents note that this period has shifted preferences toward a lifestyle further from urban centers. Going forward, these new trends are expected to persist, reflecting a lasting change in buyer expectations for their ideal homes.
New Post-COVID Buyer Criteria
Montenegro’s real estate market has undergone significant transformation in recent years, with purchasing trends reflecting new post-pandemic priorities.
Evolving Profile of Foreign Buyers
While Germans still dominate Montenegro’s real estate acquisition market, a dramatic increase in Turkish (+159%) and Ukrainian (+140%) buyers was observed between 2021 and 2022. This diversification of foreign investors significantly contributes to the local economy, both through their purchasing power and participation in the rental market.
Price and Rental Dynamics
Between 2021 and the first quarter of 2023, Montenegro’s real estate market demonstrated remarkable dynamism:
- 25% increase in house prices
- 31% progression in rents
This upward trend is particularly marked in areas slightly set back from the coast. In Tivat, for example, located near Porto Montenegro, rental prices surged by over 50%.
New Post-COVID Buyer Priorities
Investors now seek properties offering:
- More space and tranquility
- Generous outdoor areas
- Configurations suitable for remote work
- Proximity to nature while remaining accessible
This change explains the growing appeal of secondary coastal towns and peripheral areas, where prices are rising rapidly but remain competitive compared to urban centers.
Investment Outlook for 2025
Montenegro’s real estate market offers interesting opportunities for investors, with favorable forecasts for 2025. Tax incentives, particularly the introduction of a flat 15% capital gains tax rate in 2023, are especially attracting foreign buyers to coastal properties.
| Market Segment | Price Trend | Rental Potential | Investor Profile |
|---|---|---|---|
| Coastal Properties | Strong increase | High (seasonal) | International investors |
| Suburban Areas | Moderate rise | Stable year-round | Permanent residents/remote workers |
| City Centers | Stabilization | High (short-term) | Diversified investors |
To succeed in this evolving market, investors must adopt a targeted approach, considering new buyer and tenant priorities while remaining attentive to infrastructure developments supporting these emerging trends.
Good to Know:
Since the pandemic, real estate buyers in Montenegro increasingly favor properties with outdoor spaces like gardens or terraces. The growing desire for homes with offices or dedicated remote work spaces reflects adaptation to remote work, which has become standard for many. Locations outside urban centers, offering more tranquility and space, are also in high demand due to the search for better quality of life. Furthermore, digital connectivity has become an essential criterion, particularly in low-density areas, to ensure reliable connections for professional and personal activities. Healthcare infrastructure now plays a key role in property selection, with a trend toward settling near quality medical facilities. A recent study shows that 70% of Montenegrin buyers consider these factors in their post-COVID decisions.
The Rise of Remote Work and Demand for Adapted Spaces
The COVID-19 pandemic profoundly transformed workspace needs within Montenegrin households. Before the health crisis, remote work remained marginal in Montenegro; however, restrictions and lockdowns accelerated massive adoption of remote work across many business sectors.
Key developments observed since 2020 include:
- A marked increase in the number of active workers working partially or entirely from home.
- Growing interest in homes offering additional space dedicated to work.
- Systematic integration of an office or workspace during property searches, both for purchase and rental.
This phenomenon has resulted in notable evolution of real estate buyer preferences:
| Sought Criteria | Before Pandemic | After Pandemic |
|---|---|---|
| Office/dedicated space | Rarely a priority | Essential or strongly desired |
| Living space | Optimized/family-oriented | +1 room for remote work |
| Location | Proximity to workplace | Less prioritized |
Impact on the real estate market has materialized through:
- Significant price increases for properties already having a room that can serve as an office or sufficient space to set up a remote work area.
- Relative decrease in availability of these properties, often quickly withdrawn from the market due to high demand.
- Gradual adjustment by real estate developers who now design more projects incorporating flexible spaces intended for remote work from the outset.
Real estate agents have also adapted their business practices: systematic highlighting of potential offices in listings, personalized advice on possible layouts, and specific support for families and professionals seeking these types of spaces.
Montenegro’s real estate market now stands out through increased valuation of homes offering flexibility and modularity, directly reflecting the lasting upheaval caused by widespread post-pandemic remote work.
Developers are thus focusing on:
- Creating multipurpose rooms in new residential programs
- Targeted “house with office” offers
- Development of ancillary services (guaranteed high-speed internet, enhanced sound insulation)
This structural repositioning of the sector should persist as the hybrid model (in-person/remote) gradually establishes itself as a professional norm.
Good to Know:
The COVID-19 pandemic accelerated remote work adoption in Montenegro, thereby transforming household requirements for workspaces. Facing this evolution, demand for properties with offices or private work areas has significantly increased, causing price rises for these types of real estate. Many buyers now seek homes offering the possibility to configure functional and comfortable work environments, pushing developers to include these features in new constructions. Furthermore, real estate agents have adjusted their offerings and marketing to highlight properties meeting this new buyer requirement. The impact of these changes is also reflected in limited availability of such spaces, making investments in renovations focused on home offices particularly attractive for those seeking to maximize their property value.
Future Trends of Montenegro’s Real Estate Market
The impact of the COVID-19 pandemic continues to influence Montenegro’s real estate market, redirecting buyer preferences toward spaces offering more comfort, better connectivity, and access to nature. Demand for properties in coastal regions like Kotor Bay (Tivat, Kotor, Lustica) remains strong, these areas being perceived as attractive both for their natural beauty and long-term growth potential.
Regions with Contrasting Prospects:
| Region | Expected Trend | Key Factors |
|---|---|---|
| Kotor Bay & Coastline | Strong growth | International appeal, limited supply |
| Budva | Stable appreciation | Strong tourist demand |
| Rural Interior | Moderate demand | Dependence on infrastructure |
Real estate prices are steadily increasing across Montenegro. This dynamic is fueled by sustained demand that far exceeds available supply, particularly in new and secondary residential segments. Rental yields remain stable despite this price increase thanks to similar evolution in rents.
Regulatory Factors and Investment:
- Potential evolution of regulatory framework aiming to attract more foreign investors or regulate certain segments (secondary residences or tourist rentals).
- Potential incentive policies regarding digitalization of administrative procedures related to real estate transactions.
- Expected vigilance around potential restrictions on non-resident investments if the market shows signs of overheating.
Technological Innovations Integrated into Real Estate Sector:
- Increased digitalization of purchase/sale processes (3D virtual tours, secure transaction platforms)
- Growing automation in rental management
- Enhanced use of big data for predictive market analysis
Evolution of Consumer Expectations:
Buyers now seek:
- Energy-efficient or sustainable properties
- Personalized services (digital concierge)
- Private outdoor spaces and high-speed internet connection
Investors prioritize:
- Property liquidity
- Short-term rental potential via digital platforms
Economic Forecasts Influencing Real Estate Market:
- Moderate economic growth anticipated in 2025 after several robust quarters.
- Maintained strong international appeal thanks to favorable tax environment.
- Limited but existing risk related to regional and European fluctuations that could indirectly influence local or foreign purchasing power.
Key Takeaway:
Montenegro’s real estate market dynamism should continue due to a combination of relative supply scarcity in certain strategic areas, local economic stability, and rapid adaptation to new technological and societal trends.
Good to Know:
Montenegro’s real estate market is undergoing significant transformation, influenced by new post-COVID preferences where buyers now prioritize spaces with gardens or terraces in coastal regions like Budva and Kotor, which have become popular. However, inland areas might see temporary demand decline. Planned regulatory changes, particularly facilitating foreign investments, could energize the market. Technological innovations, such as digitalization of purchase processes and use of virtual tours, are gaining importance. Consumers expect sustainable and energy-efficient solutions. Economically, gradual tourism recovery is stimulating demand for secondary residences, while moderate inflation could impact construction costs.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
